VW Changes Engine Factories into Battery Plants

July 8, 2021

Engine Factories to Battery Plants

Volkswagen is changing the way it is building and supplying vehicles to the world in a big way. The German automaker is investing in all-electric vehicles faster and more heavily than other car makers in America.

Why Now?

Total global sales of fossil-fueled, internal combustion powered vehicles are forecasted to fall by over 50 percent by 2035. The hot new market is clearly in electric vehicles, and to catch that market, VW is transforming its massive engine factory in Salzgitter, Germany into its new EV battery facility. It is the first of six such plants that the automaker plans to build in Europe at a cost of over 15 billion dollars.

Battery plants are much simpler operations than engine factories. Combustion engines have over 2,000 moving parts on average, whereas high tech electric motors only have about 20 moving parts and VW is changing its workforce to accomplish the switchover.

The thought is that VW’s switch over from building gas-powered engines to electric-powered motors and battery packs may be the new blueprint for traditional automakers to make the leap to electric. The battery factory in Salzgitter is planned to go online in about two years.

U.S. automakers such as Ford and General Motors have announced they are investing billions of dollars into EV production in order to defend their market share. VW is committing to 43 billion dollars over five years. It is already converting part of its current factory into laboratories and a pilot line to test and refine the science behind its batteries.

New VW Battery Technology

Volkswagen will build its own battery packs for over 600,000 EVs a year at a cost of 2.5 billion dollars. According to VW, the bottleneck will be in how fast the company can establish, increase and ramp up the battery business. Plus, VW is testing battery recycling technology in order to reuse spent battery packs. The company is also researching new solid state batteries which do not contain liquid lithium. These new batteries will charge much faster and offer greater mileage.

The transition from building gas engines to electric motors and batteries will affect all the employees at the converted test-bed facility. The company says that it will require fewer mechanical engineers and will be bringing in new people with completely different skills such as electro-chemists and tech developers to create new software. VW is poised to become one of the biggest tech companies in Europe. The plan includes retraining as many current employees as possible with the understanding that certain legacy jobs will go away.

Repairing VW's Reputation

In 2019, VW announced that it would cut over 7,000 jobs over five years in order to refocus on electric cars. The stakes are high for VW as it tries to change its reputation as a polluter, while meeting new environmental regulations around the world.

After the emissions scandal in 2015, VW pleaded guilty to a device on its vehicles to cheat U.S. emissions tests. VW is busy trying to repair its credibility. Much like its repurposed engine factories, the car company has to reinvent itself to keep up with technology and beat competitors both old and new in the race towards an all-electric future.

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